Debt Payoff Calculator
Enter your balance, rate, and monthly payment to see your payoff date and total interest. Read the guide →
For educational purposes only. Calculator results are estimates based on the inputs you provide and are not a substitute for professional financial advice. Consult a licensed financial advisor before making investment, borrowing, or retirement decisions.
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Fill in the inputs and click Calculate
How debt payoff works
When you carry a balance on a loan or credit card, every monthly payment is split into two parts: interest and principal. In the early months, the majority of your payment goes to interest — leaving only a small portion to reduce what you actually owe. This is why high-interest debt is so destructive and takes so much longer to pay off than most people expect.
This calculator shows the full amortisation schedule so you can see exactly how each payment is applied, when the balance reaches zero, and how much total interest you will pay over the life of the debt.
How to use this calculator
- Current Balance — Enter the outstanding principal you owe today.
- Annual Interest Rate — Enter the APR on your loan or credit card. Find this on your statement or account portal.
- Monthly Payment — Enter your fixed monthly payment. It must be higher than the monthly interest charge or the balance will never decrease.
- Click Calculate to see your payoff timeline, total interest, and a full month-by-month breakdown.
The true cost of minimum payments
On a $5,000 credit card balance at 20% APR, paying only the minimum (~$100/month) takes over 9 years and costs more than $6,000 in interest — more than the original balance. Paying $250/month reduces the payoff time to under 2 years and cuts total interest to around $1,300. Even small increases in monthly payment have a dramatic compounding effect on total cost.
Frequently asked questions
What if I get an error saying my payment is too low?
Your monthly payment must exceed the monthly interest charge (annual rate ÷ 12 × balance). If your payment is equal to or below that amount, the balance will never decrease. Increase your payment to see results.
Should I pay more than the minimum?
Almost always yes. Every extra dollar above the minimum goes directly to reducing principal, which reduces future interest charges. Even $50 extra per month on a high-interest debt can save hundreds or thousands over the payoff period.
What is an amortisation schedule?
An amortisation schedule shows every payment broken into principal and interest components across the life of the loan. It helps you understand how your balance decreases over time and how much interest each payment carries at each stage.
Should I pay off debt or invest?
The rule of thumb: if your debt's interest rate is higher than your expected investment return, pay off the debt first. High-interest consumer debt (above 8–10%) almost always beats investing. For low-rate debt like mortgages (below 5%), investing may be the better financial move. Use our Extra Payment Impact Calculator to model the comparison.
Real debt payoff scenarios
$15,000 credit card debt at 22% APR — the cost of minimums
Paying only the minimum (roughly 2% of balance) on a $15,000 credit card at 22% APR takes approximately 27 years and costs $18,600 in interest — more than the original debt. Paying a fixed $400 per month instead pays it off in 5 years and costs only $3,300 in interest, saving $15,300.
$25,000 car loan at 8% — the impact of $200 extra per month
A $25,000 car loan at 8% over 5 years costs $541/month and $7,462 in total interest. Adding $200/month ($741 total) pays the loan off in about 3.3 years and reduces total interest to approximately $4,700 — saving $2,762. The shorter a loan's remaining term, the more pronounced the impact of extra payments.
Paying off $40,000 in student loans at 6.5%
A $40,000 student loan at 6.5% on a standard 10-year plan costs $454/month and approximately $14,500 in interest. On a 20-year plan, payments drop to $298/month but total interest rises to $31,500 — more than $17,000 extra. This illustrates why extending loan terms to lower payments often costs far more over time.
Should I pay off debt or invest? The 8% threshold
If your debt's interest rate exceeds your expected investment return — typically 7–8% for stock market investors — paying down debt is the better mathematical choice. A credit card at 22% is a guaranteed 22% return when paid off. A mortgage at 4% in a market returning 8% tips the other way. The break-even is your expected after-tax investment return.